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2018 saving tips

When January approaches, many of us like to make New Year’s resolutions to carry into the year ahead. We create goals to exercise more, become more health conscious, see friends and family more often and spend time trying to help others. For many, making some changes to their spending and saving habits feature on their list too. This can sometimes feel like an uphill battle, and most of us feel like we don’t know where to start. And that’s why, we spoke to Aviva’s Savings and Investing expert, Karen Deenihan, about some simple New Year’s saving and investing resolutions that everyone can make in 2018.

1. Write down your daily expenditures for one week…

A great place to start your savings journey is - for one-week write down exactly what you spend your money on. This way, you’ll realise any ‘invisible spending’ you’re doing (and yes, tapping your card does count!). These are the purchases that you make through habit, or are small costs that you have not budgeted for, but really add up over time. You can then clearly see what non-essential expenses you can cut out.

2. …Then create a budget

When you see exactly where your money is going over an average week you may be shocked at what or how much you’re spending. Create a budget for your household, and aim to make some practical cuts, but do remember it’s important to keep it realistic and achievable. Otherwise you’ll feel you’re always falling short and this can be really demotivating.

3. See where you can make savings

There are many areas in life where you can try to make simple savings:

- Make sure your phone plan is suitable for how you use it and that you’re not paying for more than is necessary.

- Ensure you are not paying direct debits you have totally forgotten about and maybe don’t need anymore like old gym memberships or magazine subscriptions.

- Take your lunch to work from home instead of buying out every day. To spend even €5 a day on lunch can cost you up to €1,150 a year.

- Be as energy efficient as you can with your household appliances and electricity. Leaving your TV and other appliances on standby overnight and while out of the house is not only a fire hazard, but actually costs you money too!

Add your daily takeaway coffee to this, an annual average of €800, and you’re looking at just under €2,000 a year that you don’t need to spend. For a full list of more simple saving tips, click here.

Source: Aviva 28 November 2017. The above example is hypothetical and does not represent any investor’s particular experience.

The above example excludes the impact of product charges and tax.

Warning: All figures are estimates only. They are not a reliable guide to the future

performance of this investment.

WARNING: The value of your investment may go down as well as up.

WARNING: If you invest in these funds you may lose some or all of the money you invest.

Warning: If you invest in a Pension you will not have any access to your money before you retire.

4. Consider the big saving goals in life

It’s a good idea to be as financially prepared as you possibly can. The first stage of this is to decide in your mind what the big things you want to have money for are. For example, education, moving house, building an extension, your pension, or retirement. These events require big savings and the longer you give yourself to allocate money towards them, the less financial strain you’ll feel.

Bank accounts are ideal for our short-term and day-to-day costs in life, but for long-term needs and big saving goals, it is a good idea to make your money work harder for you by starting a Regular Savings account or investing2. We break some options down for you here.

5. Start saving

The cost of the big events in life, such as sending a child to college, can require some big savings. In Ireland, Irish households estimate the cost of sending a child to college costs €5,0001 per year if they are still living at home and €10,0001 per child if they are living away from home. This means that a 4-year college course could potentially cost you €40,000. Note: This excludes the impact of inflation, which could cause this number to increase. You can read our dedicated article about the true cost of education here.

If you have children and hope that they wish to attend third level education, it is advisable to start saving for their education as soon as possible.

6. Check your interest

Many people are unaware of the interest rate they are earning on their deposit account, 59%1of Irish adults to be exact. And within those who are aware of their interest rate, a whopping 93%1 are noted as being dissatisfied with it.

You may not be happy with the rate of interest, in which case you should consider an alternative type of account, such as an Aviva’s Regular Saver - where you invest a minimum of €100 per month. Here you invest in a savings fund, and this way, over a long-term period, you will have a higher growth potential than you would if you invested in a bank deposit account2.

7. Start a pension

Did you know there are generous tax relief rates on pensions in Ireland? If you are a higher rate taxpayer, for every €100 you invest in your pension, you will get a €40 refund from Revenue. If you are a lower rate taxpayer, for every €100 you invest, you will earn €20 back. Pensions are only taxed when you retire so your money grows tax-free and you could get a generous tax-free cash lump sum on retirement.

To read about Ireland’s current pension gap and how it might affect you, you can click here.

If you are considering investing for the first time:

Investing is more affordable than you think, with Aviva Regular Saver you can invest a minimum of €100 per month.

If you have money sitting idle in your bank deposit account2. , having some of it invested can open you up to big opportunities. If you have a lump sum of €10,000 or more, and you want to give it the potential of a higher return than a bank deposit account2, you may want to consider a product like Aviva’s Investment Bond.

There are risks involved with investing that are not applicable to bank deposit accounts. However, there are various investment options available to you depending on how much risk you are willing to take. You can assess your attitude to risk with our handy online tool.

Aviva makes investing easy, with our Multi-Asset Choice of funds. Here, we offer you a choice of funds from three world-class, multi-award winning fund managers. There are three different risk appetites: ‘the cautious’, ‘the balanced’ and ‘the growth investor’. Our experts do the work for you, helping you to reach a decision you are comfortable with.

Get financial advice from a broker, they can discuss your options with you and determine your attitude to risk and your saving goals. They will recommend a solution that best works for you. Don’t have a broker? No problem, find your nearest one with our geo-locater tool.

Now that you’ve seen some ways that you can make some extra savings why not invest in your future and the milestones that will come with it. Visit here to learn more.

Qualifying terms and conditions apply to fixed deposits. When you invest in a bank deposit account, the value of your savings will not fall. The interest earned in a fixed term deposit account is guaranteed. When you invest in a deposit account you may qualify for compensation under the Deposit Guarantee Scheme if the bank is unable to meet their obligations to you. A life assurance levy of 1% is chargeable on all premiums invested through Aviva’s Regular Saver and Investment Bond.

WARNING: The value of your investment may go down as well as up.

WARNING: If you invest in these funds you may lose some or all of the money you invest.

WARNING: These funds may be affected by changes in currency exchange rates.

Warning: If you invest in a Pension you will not have any access to your money before you retire.

Other links

Aviva Life & Pensions UK Limited, trading as Aviva Life & Pensions Ireland, is authorised by the Prudential Regulation Authority in the UK and is regulated by the Central Bank of Ireland for conduct of business rules.
Aviva Life & Pensions UK Limited, trading as Aviva Life & Pensions Ireland, is also regulated in the UK: by the Prudential Regulation Authority for prudential rules and, to a limited extent, by the Financial Conduct Authority for applicable UK conduct rules. Registered Branch Office in Ireland (No 906464) at One Park Place, Hatch Street, Dublin 2. Tel (01) 898 7950. Registered in England (3253947) at Wellington Row, York, YO90 1WR.